Forex Articles

The biggest retirement trend of 2016 may be that people age 65 and over really are, finally, retiring.

We've all heard that retirement at 65 is no longer a given because, after all, 65 is the new 55. If you're wondering who is saying that, it is mostly baby boomers, those born between 1946 and 1964. The members of the biggest generation are now reaching age 65 in record numbers. And they have no intention of going gently into that good night.

Whether they are retired, semi-retired or starting second careers for the fun of it, their choices will dominate American culture for a long time to come. (See How Baby Boomers Will Change The Way Others Retire.) The number of baby boomers over age 55 hit 56.9 million in 2015, and by 2020 will hit a staggering 71.3 million. Following are a few of the choices boomers are making.

Younger workers have been known to kvetch that baby boomers are hogging the upper rungs of the ladder in the workforce. By their sheer numbers, they dominated throughout their careers, but the Great Recession that began in 2008 put the kibosh on retirement plans for many. (See Are More Baby Boomers Returning to Work After Retirement?)

Well, the recession is behind us now and so, apparently, is the reluctance of baby boomers to retire. As of 2015, there were still some 45 million baby boomers in the workforce, but as an age group they are now a third-place minority, behind the so-called Generation X and the Millennial generation. That's according to an analysis of the American workforce by Pew Research Center, based on the latest U.S. census data.

If you want to know what those retirees will be up to, you'll need satellite tracking. A new survey from AARP says that fully 99% of baby boomers are planning to travel for the fun of it in 2016, and they have an average of four to five trips in mind. That's a lot of moving around, since there are 76 million of them, or about 28% of the population.

They're not scrimping, either. The survey results suggest that they're less concerned about scoring a bargain overall than about the availability of free Wi-Fi. They're planning to take short weekend hops to domestic destinations throughout the year, but most plan one or more ambitious bucket list vacations, often to an international destination.

The economic impact is significant. In recent years, the boomers have spent more than $120 billion a year in leisure travel, by AARP's estimates. The latest numbers suggest that they are leaving younger generations in the dust: Barely more than half of Americans even take all of the vacation days their jobs allow them.

Once again, baby boomers are defying expectations. As they approach or surpass retirement age, Americans are expected to downsize, trading their big family homes for smaller, more efficient houses, apartments or units in senior communities. But baby boomers seem to be staying put.

In fact, a report from Fannie Mae concludes that there is no statistical evidence to date that the current generation of older Americans is inclined to abandon their family homes.

In the words of The Washington Post, this is serving to clog up the real estate pipeline. It is causing a shortage of homes for sale, and a corresponding increase in prices. Real estate agents complain that the boomers are sitting on a vast inventory of desirable real estate. To which baby boomers, from a comfortable perch by the backyard swimming pool, probably reply with an unprintable phrase picked up at a Rolling Stones concert circa 1972.

The only explanation offered in the story is that baby boomers, like American homeowners of all ages, suffered a significant loss in home equity during the years of the housing bust. They are determined to stay put until their homes regain all, or most, of that lost value. But maybe it's also because they don't have to downsize, at least for financial reasons. And that's because …

The boomer consumer will continue to control an outsize share of U.S. wealth. Collectively, this 28% of the population controls 70% of the total net worth of all American households. That's a staggering seven trillion dollars. They also have a greater discretionary income than any other demographic. Overall, they account for 40% of consumer product demand.

Anyone considering marketing to the boomers had better keep one thing in mind, though: This generation hates, but hates, being called senior. They spend a lot of time, effort and money looking, acting and being youthful and vigorous. If you think I've fallen and I can't get up is a funny tagline, you're in the wrong business for America's most lucrative target market.

About 42% of Americans age 65 and over are currently single. But that doesn't mean they've given up on looking for love. Increasingly, they are using online dating sites. (AARP has one devoted to singles.) However, the vast majority of single older adults seem to rely on old-fashioned networking to find new partners. Finding a new partner is a serendipitous effect of staying socially active.

This high percentage of single seniors is in part due to an increasing rate of divorce among older Americans. The divorce rate actually doubled among those ages 50 and over between 1990 and 2010, according to a study by sociologists at Bowling Green State University. And that is a peculiar fact, given that the divorce rate for Americans overall has been steadily declining since the 1970s.

The year 2016 may prove to be a transitional year for the baby boom generation. In terms of sheer numbers, they are beginning to retire at last. But you may be sure that this is just the latest of the many trends that they will set.